Did Blythewood man illegally collect $1 million-plus in VA benefits?

Dennis Paulsen leaving federal court this week in a wheelchair. JOHN MONKjmonk@thestate.com

Dennis Paulsen leaving federal court this week in a wheelchair. JOHN MONKjmonk@thestate.com

COLUMBIA, SC

For years Dennis Paulsen of Blythewood played in a Saturday baseball league at Owens Field, pumped iron at a local gym and shot pool at Jillian’s in the Vista. He ran in the Marine Corps Mud Run.

While doing all that, Paulsen, 45, was collecting a combined $9,400 monthly in tax-free Veterans Administration and Social Security benefits for being severely impaired due to multiple sclerosis, according to government evidence in a federal trial being held this week at the U.S. courthouse in Columbia.

In a closing argument to the jury on Thursday, Paulsen’s lawyer, Melvin Bannister, asserted that for years while collecting benefits, Paulsen actually has suffered a doctors-diagnosed case of multiple sclerosis but that it has been in remission. Even so, he has his ups and downs because of the disease, Bannister said.

It is true that Paulsen played sports, but afterward, he “suffered for it, and he had to go home and rest,” said Bannister, who asked the jury not to believe the “outright lies” told by many of the prosecution’s 25 witnesses.

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On Friday morning, Judge Margaret Seymour will instruct the jury on the law in the case – Paulsen faces two counts of stealing from the government, one count involving the Veterans Administration and the other, the Social Security Administration.

The case is unusual in that such a large amount of alleged fraud – a combined $1.5 million in VA and Social Security benefits, mostly from the VA – by one person is rarely brought to trial or even investigated by the government. A major reason is that after a disability case is diagnosed and someone’s status is established, the government rarely investigates to verify that someone’s disability is what they claim.

Multiple sclerosis, known by its initials MS, is a fatigue-inducing nervous system disease that can affect the brain, spinal cord, vision and balance.

After being diagnosed in the early 1990s with 30 percent disability because of multiple sclerosis, Paulsen had his impairment rating sharply increased in the late 1990s by the Veterans Administration. To get that kind of diagnosis, Paulsen reported inability to use his hands and feet, loss of balance and the need for daily help. But Paulsen was actually faking symptoms to get increased monthly checks, government prosecutors said.

Two years ago, the Veterans Administration began investigating Paulsen after getting a tip from his ex-wife’s stepfather. The stepfather said Paulsen’s disabilities weren’t what he claimed and that the Blythewood man was actually leading an active life, according to government witnesses.

“Everyone is entitled to benefits, but what you are not entitled to do is lie, cheat and steal to get them,” assistant U.S. Attorney Jay Richardson told the jury in his closing argument.

After doing an initial probe in 2014, VA and Social Security criminal agents Paul Lee and Neal Dolan launched an investigation of Paulsen that, before it was finished, involved undercover agents, video surveillance, tracking him to places like Jillian’s, retrieving surveillance videos from banks and the Columbia Metropolitan Airport. The videos were played to the jury and showed Paulsen doing activities he shouldn’t have been able to do with the impairments he claimed.

Key pieces of evidence were photos and writings from an Internet blog kept by Paulsen’s former wife, Christine Paulsen, from about 2006-2011. During that time, Dennis Paulsen was receiving his major benefits.

In that blog, Christine Paulsen had inserted photos of her husband playing numerous adult sports and being highly active. She also had written glowing notes about how proud she was of him. She also told the jury that Paulsen told her he was exaggerating his symptoms to game the system, prosecutor Richardson said.

But in 2012, the Paulsens began to fight. She moved out, taking their two children with her. In 2014, they got a divorce. She was a government witness during the trial, telling the jury what an active life he had led. But her testimony, Bannister told the jury, was tainted.

“Why are we here? It’s the same old story you have heard many, many times – a woman scorned,” Bannister said. “She has convinced the government and its agents to prosecute her ex-husband.”

Assistant U.S. Attorney Bill Day wrapped up closing arguments, telling the jury Paulsen actually does have a case of MS. But it is a mild case of the disease, not the severely debilitating form Paulsen claims to have.

“MS can cover a broad spectrum; the question is, does it affect his life?” Day said.

According to evidence, Paulsen had joined the U.S. Navy in the late 1980s, intending to become a SEAL. But Navy doctors determined that he had a case of multiple sclerosis and mustered him out. He began receiving disability benefits and in the late 1990s, was diagnosed as wholly disabled. The Social Security Administration joined in the diagnosis. As result, he got a sizeable monthly check.

During the trial, Paulsen testified for more than four hours, telling the jury he did in fact have a severe case of multiple sclerosis.

In 2004, he moved from Virginia, where he had been diagnosed originally, to Blythewood.

According to government witnesses, Paulsen learned he was being investigated in 2014. Almost immediately, he began to use his wheelchair and schedule appointments with VA doctors, according to prosecution evidence.

Bannister told the jury that news of the government’s investigation and stress over his wife and children leaving him caused a relapse. During the closing arguments Thursday, Paulsen listened with his eyes closed and often laid his head on his arms on the defense table.